Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On October 1, 2017, Flint Corporation sold a harvesting machine to Pearl Industries. Instead of a cash payment, Pearl Industries gave Flint a $139,000, two-year,

On October 1, 2017, Flint Corporation sold a harvesting machine to Pearl Industries. Instead of a cash payment, Pearl Industries gave Flint a $139,000, two-year, 12% note; 12% is a realistic rate for a note of this type. The note required interest to be paid annually on October 1, beginning October 1, 2018. Flints financial statements are prepared on a calendar-year basis. Required:

a) Assuming that no reversing entries are used and that Pearl Industries fulfills all the terms of the note, prepare the necessary journal entries for Flint Corporation for the entire term of the note

. b) Repeat the journal entries under the assumption that Flint Corporation uses reversing entries, but only up to and including October 1, 2018.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Organizational Auditing And Assurance In The Digital Age

Authors: Rui Pedro Marques, Carlos Santos, Helena InĂ¡cio

1st Edition

1522573569, 978-1522573562

More Books

Students also viewed these Accounting questions